Creator Financial Toolkit: Wise
Wise started life as Transerwise, a money transfer service. However, the company name was changed from Transferwise to Wise to reflect Wise’s broader business. Over the years, Wise has added more and more services to its business model, most notably its borderless account. This growth in Wise’s business model meant that the name Transferwise no longer represented the true scope of the Wise brand.
Wise Business Borderless Account
The Wise Multi-Currency Account is an account similar to a traditional bank account with added benefits. This account was previously called a borderless account. While the account name no longer contains the word borderless, the benefits still apply to the account.
With PayPal and Payoneer, a fee is applied when making payments across national borders. However, with the Wise Business Account, no such fees are applied.
Wise is an international service that is available in multiple countries around the world. Services and account features may vary from country to country. However, since I am based in the United Kingdom, I will speak about Wise from a United Kingdom perspective. That said, many of the services and features are the same internationally, with some features not available due to perspective countries rules and regulations.
With Wise’s multi-currency account, you can hold multiple currencies, just like with a Payoneer account. The account allows you to hold up to 10 accounts of currency with the currency’s local country banking details.
One key difference with Wise accounts is the legal territory of the account. while I am based in the United Kingdom. If I have an American currency account, the account is actually legally based in America.
This may seem like something small, technically. However, this can impact the amount of fees paid when funds go into your account. Especially when used in conjunction with a Payoneer account. I will explain the relevance of this later in this post.
As mentioned before, Wise, previously called Transferwise, still operates a money transfer service.
From a business perspective, using Wise to transfer funds to and from an individual or company internationally saves money on a variety of business activities. Whether that’s sending funds to a supplier or paying an employee,
Wise has the financial features to cater to most businesses needs.
The reverse of this is that receiving funds into your business account is made simple with Wise’s multi-currency account. Businesses and individuals internationally can pay you in their local currency without the need for currency conversion, saving money on both sides of the transaction.
Wise Debit Card
The Wise account comes with a debit card. Allowing you to pay for goods and services offline and online. If a transaction is in a currency other than your business’s local currency, the funds will be deducted from the transaction currency balance if available. All this saves on the need for currency conversion.
The Wise Debit Card comes in two formats: a physical card and a virtual card. The virtual card can be used with Apple Pay and Google Pay. In order to get a virtual card, you need to have a physical card. You can have up to three virtual cards.
While my focus is on the lone creator, as a creator grows, it may become necessary to have employees.
Being able to give employees an additional Wise card is convenient.
Wise offers the ability to limit the amount an employee can spend on a card issued to them, whether it be physical or digital. Additionally, the tracking of expenses is helpful for accounting purposes. The number of cards that can be issued is unlimited; however, there is a fee associated with the issuing of a card.
Paying multiple employees manually overtime can get tedious as your business grows. The Wise batch payment tool allows for the payment of multiple payments in one process. All that is needed is for payment details to be contained within a CSV file.
The payment tool can also be used to pay multiple invoices at the same time. It does not matter the reason for the payment, whether to freelancers, suppliers, services, or employees. The batch payment tool is available to creators when needed.
Currency conversion is at the core of Wise’s business model. The ability to make and receive payments in different currencies is made easy with Wise’s approach to currency conversion. All transactions are transparent, so there are no hidden fees. The total cost of fees is known before a transaction is executed
Wise charges a fixed fee plus a percentage of the total amount, which is usually 0.2%–2% of the amount being transferred.